What’s your budget?
Before you fall in love with a home, be sure to fall in love with the numbers. If it’s your first time getting a home loan, it’s important to connect with an independent mortgage broker to walk through your financing options.
There’s much more that goes into the cost of homeownership than the purchase price. Other factors include: property taxes, homeowners insurance and the interest rate on the home loan. Preparing a thorough and comprehensive budget is a good first step to understanding how much home you can afford. Our home affordability calculator makes this easy.
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Ready to crunch some numbers after using this home affordability calculator? Start with listing all your monthly financial obligations such as your car payment, credit card debt, utilities and more. Be sure to include funds for emergencies, savings and unexpected expenses to help calculate your potential buying power.
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Determine all your sources of income and calculate what they add up to each month. This will help you figure out the potential amount of your future home loan based on income. Remember to include revenue from alimony, investment profits or rental earnings. If you have a co-buyer, include their income and assets, as well.
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List all other housing-related costs such as property taxes, homeowners insurance and mortgage insurance.
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Add up all your other monthly expenses. Since some of these costs can fluctuate from month to month, it's a good idea to estimate on the higher side. These include things like car payments, groceries, utilities, etc.